Micro-transactions: The Real Cost of Video Games

The video games industry has seen a huge rise in the number of games containing micro-transaction in the last 10 years, so much so that they are starting to become a norm. Although, what effect are they having on the industry? Are they being used to heighten the gaming experience or are they a cash grab to ring out as much money from the player as possible?

Micro-transaction are an in-game option where the player can purchase in-game items such as loot boxes, player skins, in game currency etc. for real world currency. They are predominantly popular in free-to-play games but have made their way in recent years over to larger AAA games. Depending on the items or the game in question these purchases can range from a few pence to hundreds of pounds.

There have been many problems with Micro-transactions through the years, however the biggest problem I have with micro-transactions is the cost of some of them. I have played games where prices for micro-transactions have gone into the hundreds of pounds (cost that high kind of defeats the point of the ‘micro’ part of micro-transactions). I get that there will be people out there to whom a few hundred pounds is pocket change but to the rest of us mere mortals £100 is a significant amount of money and not an amount I would spend on purchasing a whole game let along items within a game. This is especially a problem when you consider that there are micro-transactions of this value in games that are also aimed at kids. There have been so many horror stories about children taking thousands from their parents accounts when playing games such as FIFA or GTA. In fact I personally know of someone who spent nearly £200 of their parents money in micro-transactions on GTA Online not knowing that they were spending real money.

Another major problem I have with them is the pressure some players are under to make micro-transactions. The 2 greatest pressures are gameplay pressures and social pressures. Gameplay pressure can be found a lot in pay-to-win games where players who pay have an advantage over those who don’t which leads to paying players getting better rewards which gives them more of an advantage with the cycle growing exponentially the longer the game is played leading to a larger gap between paying and non-paying players. I found this first hand when I played FIFA Ultimate Team in FIFA 18. It got to the point where no matter how much I played I couldn’t improve my team because I couldn’t beat other teams who had world class players in order to gain the rewards that included the packs that these world class players were in. The only way it seemed was to pay for the packs directly, the pack with the greatest odds of me getting the best players in the game cost roughly about £70 and after doing some research I saw that these packs only had a 2.5% chance of getting the best cards. You’d need 20 packs to have a 50% chance of getting a world class card, which would cost you £1400. It was because I was stuck in progressing my team & refusing to pay for any of the packs that the game lost all interest for me and I quit playing soon after. I also never bought a FIFA game since nor have I had the desire to. Social pressure comes from other players influencing the player to make purchases. As in games such as Fortnite players using default or free skins are usually labelled as being financially poor or bad at the game. These social pressures play on peoples insecurities and will cause people to make purchases they might not particularly want to or can’t afford in order to fit in.

As I stated in my previous posts I see why developers are including micro transactions in video games. The idea that it allows those people who can afford to pay more for video games can in a way subsidise the price for those who aren’t as well off. Sadly however, this doesn’t seem to be the case. A survey carried out by Parent Zone on 1001 children in the U.K. between the ages of 10-16 found that 76% of them agreed that online games try and make players spend as much money as possible. Personally I think a few developers rip off their players because they can get away with it. Not that I am painting all developers with the same brush, there are some examples of how micro-transactions can be implemented correctly but sadly they get overshadowed by the numbers of occasions that they are used unfairly. Fallout Shelter is one of my prime examples of good use of micro-transactions, players can buy lunchboxes which contain extra game items such as weapons, armour and characters. Lunchboxes can also be gained by grinding in-game too. This means that although micro-transactions are available the game is still totally playable without needing to purchase them, they become more a tool of convenience than a necessary part of the game.

Whether you love them or hate them, I don’t think micro-transactions are going anyway any time soon. They are too much of a cash cow, in fact in 2016 EA recorded over $1.3billion in revenue from micro-transactions across their entire catalogue that year. These levels of revenue also means that developers would rather prolong the life of existing games that is making money than take a risk on new IP’s that could potentially make a loss financially. This can be seen in GTAV, despite being 7 years since it’s initial release on the 360 and PS3, the game (especially GTAOnline) continues to generate massive revenues, according to Tweak Town in 2019 GTAOnline generated $595million in revenue through digital in-game content alone. This will only increase with the release of the game on the PS5 & Xbox Series S/X later in the year. Looking at it this way you can see why they are not putting a rush on GTA6. I just hope that the industry doesn’t start to stagnate because of this. Although looking back at the games I’ve reviewed from this year I don’t think it’s going to be too far off.

Loot Boxes: A Chance Worth Taking?

I was originally going to lump Loot Boxes and Micro-Transaction together and have one article that covered both but in the end I just wouldn’t have been able to do both topics justice if I watered them both down for one piece. There is far too much to say on both subjects, so as such they are both getting their own spotlight. Plus since I quite enjoyed the change of tone in my article about conflict minerals I’ve decided I wanted to ride the momentum of this wave and see how many more pieces I can fire out before it subsides.

Loot Boxes (for those who are unaware), are items in video games that contain random loot which can vary from cosmetic items (such as skins or costumes), gameplay items (such as weapons or characters) or in game currency. How to achieve Loot Boxes varies from game to game but the usual methods are through in-game achievements (such as levelling up your character or team) or by purchasing them using either in-game or real currency.

In a number of countries across the globe there have been discussions raised asking whether or not Loot Boxes are a form of gambling due to the rising numbers of video games containing them that are aimed at children as well as the addictive nature that surrounds them. People who are pro Loot Boxes will argue that they are not gambling as you cannot trade your Loot Box prizes for real currency in the same way as casino chips for example, plus since you are guaranteed a set number of prizes for each loot box there is no risk of loss, much in the same way as a toy gumball machine will always guarantee you a prize. On the other hand however, those opposed to them will tell you that since they are a game of chance and the addictive nature of them, they should be classed as gambling and as such not marketed to children.

I personally think the subject is far too complex to sit wholly on one side or the other. I personally don’t think they should be classed as gambling. I see loot boxes in the same light as Pokemon cards or football stickers but nobody’s been in an uproar about these being a form of gambling. The main thing to me is that in gambling there is an element of winning and losing. You can get a return on your stake or you can loose it, this isn’t true with Loot Boxes. Like trading cards you are guaranteed a set number of rewards, you don’t get any more or less each time you buy. It’s also true that some items will be rarer than others but in the end you still get something. With this in mind, a tombola is closer akin to gambling than loot boxes but we still let our kids buy tickets.

That’s not to say that there isn’t a problem with loot boxes in their current format. The biggest being that even if there is debate about whether or not they are classed as gambling, they still create the same feeling that gambling does, which can lead to gambling addiction. This can potentially be dangerous, especially since a lot of games with loot boxes are available to children, who are more mentally susceptible to addiction. This is what leads some people into spending thousands on loot boxes and other micro-transactions (I will go into this in more depth in my post on Micro-transactions).

So how do people get addicted to loot boxes? It’s the same way people get addicted to gambling, some people win big and get one of the rarest items and continue buying in order to re-create that winning feeling, some will keep playing because they have had poor box after poor box and will keep going wishing to “recoup their losses” or that “the next one will be the winner”. There are many reasons but what most of them have in common is that they all chase some sort of reward and a sense of a high that comes with it. As these players “win” more they can become desensitised to winning causing them to take higher risks in order to maintain the same states of euphoria.

I understand why the games industry has shifted to including elements like loot boxes and micro-transactions. With the rising development costs as games get bigger and require more staff and resources. In order to keep the game costs low for the gamers, developers have to subsidise the cost by generating revenue elsewhere. Back in 2016 US$650million was spent on EA’s Ultimate Team Player Packs across all their sports games, accounting for about half of EA’s entire micro-transaction revenue that year.

I do believe that the games industry should be doing more to combat problems caused by loot boxes. They should be making sure that those who buy loot boxes can do so in such a manner that it is sustainable. Games should be just as playable with or without loot boxes in order to allow them to be an addition to the game rather than one of it’s major components. Warnings should be provided to help warn both gamers and parents about the contents of the games they are playing or buying for their children, and support should be made available to those who need help. Laws should be put in place to enforce this as well. Here in the UK the Gambling Act was last updated in 2005, long before anyone saw the rise of loot boxes. In the case of children, parents should take an active interest in the games their children play and the content within them. Being a little game savvy will help both you understand the games your kids are playing and also provide a new ground of common interest. If we all band together and do our bit we can protect the most vulnerable among us without sacrificing on the games we love.